Fusion-io: Fiscal 3Q12 Financial Results

Fusion-io, Inc. announced its financial results for its fiscal third quarter ended March 31, 2012.

Fiscal 1Q2012 GAAP Financial Results
Fusion-io reported record revenue of $94.2 million for the fiscal third quarter of 2012, up 40% from $67.3 million for the same quarter of 2011 and up 12% from $84.1 million for the prior quarter. Net loss for the fiscal third quarter of 2012 was $4.7 million, or a net loss per diluted share of $0.05. This compared to net income of $7.0 million, or $0.09 per diluted share in the same quarter of 2011. Gross margin for the fiscal third quarter 2012 was 52.1% compared to 53.2% for the same quarter of 2011. Operating margin for the fiscal third quarter was a loss of 5.2%.

Fiscal 3Q2012 Non-GAAP Financial Results
Non-GAAP net income for the fiscal third quarter of 2012 was $6.9 million, or $0.06 per diluted share. This compares to non-GAAP net income of $9.0 million, or $0.11 per diluted share, in the same quarter of 2011. Non-GAAP gross margin for the fiscal third quarter 2012 was 52.1% compared to 53.2% for the same quarter of 2011. Non-GAAP operating margin for the fiscal third quarter 2012 was 7.6%. A complete reconciliation of GAAP to non-GAAP results is set forth in the attachment to this press release.

"This is an exciting time for Fusion-io as our leadership has enabled us to build a strong foundation of core technology, expertise, service excellence, and trust in this rapidly evolving market, which we believe has resulted in the industry validating our vision,” said David Flynn, Fusion-io chairman and chief executive officer. "Our commitment to continued innovation is illustrated by the introduction of our software development kit, or SDK, which provides developers with new programming primitives to simplify application development and unlock the true potential of flash. This extends the innovation of ioMemory to our strategic development partners who can now add game-changing performance improvements and differentiation in their respective markets."

"We are pleased to deliver a record revenue quarter of $94.2 million, with non-GAAP earnings of six cents," said Dennis Wolf, Fusion-io CFO. "We believe our vision is resonating with customers and strategic partners, and we will continue to prioritize the expansion of our market footprint along with investment in innovation.”

Other Financial Highlights

• Deferred revenue at the end of the fiscal third quarter was $22.5 million, an increase of $6.5 million compared to the prior quarter.
• Cash and cash equivalents at the end of the quarter were $294.7 million.
• Inventory balances at the end of the fiscal third quarter were $72.0 million.
• Capital expenditures were $6.3 million in the fiscal third quarter and $16.6 million in the first nine months of fiscal 2012.

Business Highlights

• On April 18, 2012, announced its software development kit (SDK) to enable customers and software developers to optimize enterprise, web, and big data applications through direct programmatic access to Fusion-io’s ioMemory subsystem.
• On April 12, 2012, announced ioFX, a new product for the single user workstation market which accelerates key content creation software, including Adobe Creative Suite 6.
• On April 5, 2012, announced that its ioTurbine software now supports VMware ESXi 5.0 virtualization hypervisor, enabling customers using 4.x or 5.0 versions of ESXi to benefit from integrating the ioTurbine software to enhance VMware performance.
• On March 12, 2012, Fusion-io and value-added reseller, Tokyo Electron Device, announced the availability of the Fusion ioDrive2 and Fusion ioDrive2 Duo in Japan.

Business Outlook
Fourth quarter of fiscal year 2012:

• Revenue is expected to be essentially flat sequentially.
• Non-GAAP gross margin is expected to be in the range of 53 to 55%.
• Non-GAAP operating margin is expected to be in the range of 3 to 5%.
• Diluted shares outstanding is expected to be approximately 111 million shares.

Fiscal Year 2012:

• Revenue growth is now expected to be approximately 75%.
• Non-GAAP gross margin is still expected to be in the range of 54 to 56%.
• Non-GAAP operating margin is now expected to be approximately 9%.
• Diluted shares outstanding is now expected to be approximately 108 million shares.